welcome to "power lunch." i'm dominic chu. today we are remembering charlie mungar, warren buffett's partner. we'll look at some of his best wisdom and everything he meant to wall street. also mark cuban making major moves, quitting his job, so to speak, selling his team. he's going to spend more time with his family. but he may also have bigger plans as well. >> interesting. looking forward to that. let's check the markets. dow is up 134 and it's leading the way today. the s&p is up ten points for a quarter percent gain, but still up 19. shares of general motors are popping today.

the company detailed the impact of the labor deals saying they'll have enough cash and they're raising their dividend and buying back shares. and a huge deal brewing in the health insurance space. "the wall street journal" reporting cigna and humana are in talks to combine. both are negative. more on that later on. we have to reflect on the life and impact of investing legend charlie munger. on set is someone who has observed him at many meetings and a legendary investor himself. we got the almanac here -- >> i got a copy of -- i feel like tom hanks on set here. >> i love the fact that you have the original right there. >> we have it. but it was a gift in 2009 from

someone. >> yeah. it's going for -- so i brought in -- i have a copy. but my cat attacked it a couple years ago. i don't think i could sell it for the $75 it's going for -- >> that's not the same as my dog ate my homework. >> it's one of those small things in life. >> what happened is that i met warren because i knew of warren because when i went to study roger murray skied him at columbia, warren had studied. and then he covered and owned a piece of a company in new york city called pinkertons. and so you learned about what he did about taxes, you learned about what he did about cash flow. and then fast-forward to somewhere around a quarter of a century ago, 25 years ago, i would be invited to the annual meetings and we've been doing that for 15 years. so i actually found one of the cards as a -- a shareholder -- >> can you hold it up again? >> i did not -- i did not buy

the shares of berkshire hathaway for clients until we had our open end fund which was started in the mid '80s. we bought it at $3,000 and we have done significantly well. but when you go to the meetings what happens is that they have a little cartoon video. charlie is always in one of those. it's always an interesting seen that he sits. and then the second part is obviously when warren goes around after the business part, they ask questions and the audience requests questions and occasionally warren would turn around, charlie, you have anything to add? and then he would say something very crypt and interesting. so sometimes he would also say, i have nothing to add. >> you mentioned, obviously, shareholders since the '80s. any moves you would make with berkshire? they haven't been as active in recent years. doing more with their investment

managers and things like that. >> they bought a company that we owned that was quite important in the insurance business. and that was about 8 or 9 or $10 billion. i forget. when you look at the portfolio and you say, okay, there's 1.4 million shares of berkshire that sells at $550,000 and what is it going to have as book value next year? we think it's going to be higher than that. higher than the 550,000. but apple is extraordinary interestingly. here's a guy that maybe would not be -- charlie would say, it was high-tech to warren, the blue chip stamps -- the stamp book that they had. but independent of that, that is a significant amount of value in the company. so now you're warren and you know that the way to make money is to -- that -- you know, they've adopted is a good business, good management and a reasonable price. and so instead of buying something that you can liquidate

and make money like the old story of cigar butt, buy it and liquidate it to get the cash back among other things, that's what he did. charlie had a great sense of humor. >> we talked about how sort of what you did way back when. but as berkshire has evolved, do you think a lot of the people who follow the value investing, do you think they've evolved as well. >> there's no question, basically when i was -- when warren start, you would have to go to washington, d.c., to go to the sec files to get data. when i started, you would go to the new york stock exchange and get microfiche. in the future you're going to gather data with a.i. gathering the data is going to be different. the second part is if i went on and looked about what kelly evans has done, what's a history and so on, or dom, yeah, i would have double check. we've done that before. i've asked for speeches to be prepared, the governor of

nevada, he's now the president of unr, and so you have -- it's a lot of facts that need to be checked. over time, that's going to evolve. the second part is how do you handle the value of a franchise which is the goodwill or the value of a business on the books that has historically part of graham, you involve certain type of dynamics. >> we've got some headlines coming out. we're going to go from the microeconomic company specific stuff to steve liesman right now who has details on the fed's beige book results. steve, this is the look at the u.s. economy. what does the fed and its member banks, what are they saying about the u.s. economy? >> yeah, something that really animates the fed these days. they said economic activity slowed with four districts reporting modest growth, two saying growth was flat or slightly down. but six said there were slight declines in economic activity.

this is the six weeks ending about mid-november here. this is a report from the fourth quarter, not the third quarter where we got that strong growth. retail sales were mixed. consumers showing more price sensitivity, that's important for the inflation outlook. travel and tourism was healthy. manufacturer's outlook, it did weaken. demand for business loans declined for real estate. consumer credit, though, remained healthy. a lot of talk about that. some banks noted a, quote, slight uptick in consumer delinquencies. not a big one. a slight one. overall the economic outlook diminished compared to the prior report. onto the important aspect of the labor outlook. demand for labor continued to ease. according to the reports, more applicants were available, retention improved and there were reductions in head counts, both through layoffs and

attrition. it was a different report than we had during the strong labor markets. the labor market is said to be tight for skilled workers. on the important aspect of wage growth, it was said to be modest to moderate and many districts reporting an easing in wage pressure. another good sign for the fed and its fight against inflation. overall on inflation, price increases largely moderated. obviously prices remain elevated. most districts expect -- price increases to moderate into next year. the way the fed is running the show right now, they're kind of in a holding pattern, looking for a reason to go either way. as you heard from my interview this morning, they're relying more and more on anecdotes like this. this suggests that the economy is moving in the way that they want which is a slowing economy after that breakneck number we got this week of 5.2% growth in the third quarter. most economists i see now looking at more like a 2% range nor growth. >> it implies that the scales

are balanced from a rate perspective. they're looking for something to tip it either way. steve, thank you very much. we'll talk to you later on. let's get more market reaction to the beige book and the state of the economy and markets with mario who is still on set with us. >> when you step back and say, okay, what is the world like for investing, forget about short-termism in a market that is dominate because of a variety of things. basically the -- international monetary funds says there's $110 trillion of global gdp. the united states is 25%, china is 17, europe is about 17, 18 -- lower number. what's going on in china? what's going to -- the implications of that on the global marketplace? what's going on in the united states. you break the u.s. down, consumers 70% plus or minus. you have government spending, blah, blah, blah. the consumer's net worth given

the rally in the month of november, that's going to be at least $150 trillion. ten years ago, ten years ago, not ten weeks ago, it was 75 trillion. the consumer debt has gone from 14 to 20. up six. but the net worth is up 75. you have an income disparity and that's why -- what the screen actors guild and what others are doing to try to help pay the bills of electricity, housing, food. that is -- has a major regressive impact. so from our end, you know, this recession, we've gone through so many cycles. the consumer is okay. autos, uaw was on strike. that's recovering. car sales will be out this week. industrial sector has -- every company you talk to, reshoring. whether it's in -- put in mexico or in the midwest.

you got the chips act, you got the ira act, all of which are coming together. so while you're having the fed try to reduce aggregate demand, the amount of money that's being put into thesystem by the government is completely opposite. they're also reducing the amount of money that they have on their balance sheet by 95 billion a month. that's a trillion dollars a year. there's a lot of trade-offs. that's the way we see it. >> trade-offs is one thing. if you're talking about the same kind of push into the economy that you're talking about from all the stimulus that's going into the system. at the same time money is getting taken out or tightened by the central bank and its actions, right? it implies, then, that there's a level or an equilibrium that's been reached -- >> that is going to be reached. i'm not saying it's there yet. because the banks themselves having some issues. without getting into accounting dynamics about the banks and health of maturity, the fact that the fed -- the ten year has

dropped fputs extra in their balance sheets. so i don't know what's going to happen. that's not the relevant point. for me, it's all short termism. when i start in the business, the dow was 1,000. ten years -- 1967 i was a sale side analyst. today it's 35,000. 40 years now, 40 years from now when we get together, don't be short term. it's going to be a million. that's an 8.2%. if you look at the numbers for the last 100 -- >> do you worry about what munger said at the meeting? >> four years ago if we were here wouhan, russia invading, te

banks having a crisis again, the mideast crisis, and then you have a food crisis, an energy crisis, a water crisis and all sorts of challenges on a global basis. what's different. within that framework if i look at the data for the next x number of years, it stays flat. you could make a lot of money at the markets by doing simple things, buying specific stocks. >> let's get into that. you're at your trade, you're an analyst, you pick stocks, you look at their balance sheets and income statements. what is the opportunity right now? where is it? are there specific -- is it still media? >> let's start with a simple a, you talked a little bit about selling some of the family money to -- maybe because they were worried about macau. they're buying a basketball team. mark cuban's company. so here i want to bring you the

atlanta braves. publicly traded, 61 million shares you multiple that, it's $2 billion. we think it's worth a lot more. i think you'll make -- and john malone and greg will probably monetize it in some fashion. secondly, the growth of the hispanic market, the growth of the hispanic players, we have a pitch clock, you got to buy it. you got to buy a baseball team called the atlanta braves. if you want to buy a basketball team. venture capital play of the sphere has worked for him. how he monetizes that is work in progress. but it is really a technical delight. the stock is selling at $171 with 24 million shares -- >> the sphere stock? >> sports. msg, madison square garden sports. you're getting the rangers and the knicks. the knicks did okay last night. they got a game coming against

detroit. we'll see. but that's not relevant. so those are two things. and then agriculture. the american farmer works his fanny off 24 hours a day, plants fence to fence. there's a couple that is relisting from the new york stock exchange at the end of the month called case new hollands. the stock is 1.3 billion shares. john deere is selling at 360 with a couple hundred million shares, 300 million shares of 288. i forget the number. bottom line, we think you're going to double your money. short term the stock is delisting and certain entities can't own it. >> i mean, for those people who aren't familiar with the stock, they make heavy machinery. it's john deere-type stuff. >> case new holland, when i was

a rookie analyst, i would visit them in wisconsin. they then relocated down to houston. going back to one more dynamic. advertising. you asked me about it. you're going to have a tsunami in political advertising in 2024. i'm asking every viewer to tribute to their favorite politician because they're going to spend it on my advertising on broadcasting stations. >> he's got an ax to grind. >> including cnbc. so, brian, if he's listening, comcast will do well. what tv stations will benefit? tenga has been buying stock back, they're down to under 200 million shares. that's 3.2 billion market cap. the regulators turned down a deal to be bought at $23 for some -- they did it in a very interesting way. i think the stock is around 15. i think you're going to make 50%

in two years. >> coming armed with a slew of stock -- >> i own 3 or 400 of them. i have a lot of losers too. >> we have to bring you back when we have an hour to talk about stock picks. thank you very much. >> good to be on the show and thank you. >> thank you for sharing your reflections about charlie. we appreciate it today. coming up, we'll talk shares of foot locker jumping as the company's results not quite as bad as feared in our journey around the ecosystem. we'll look at stores inside the mall. and as we head to break, rover is up. they're agreeing to be taken private by blackstone for $2.3 billion. and trading almostt at ath level with a 28% pop. we'll be right back.

♪ welcome back to "power lunch." stocks at session highs right now. meanwhile the ten-year yield falling below the 4.3% mark. you just heard mario referring to that. for the first time, by the way, since september. let's get out to rick santelli in chicago for more on that bond trade. rick? >> you know, it's all true. yes. we touch 4 1/4. but the real story today isn't that part of the curve, it's the short end. let's show twos and tens together.

here's a three-day chart. staircasing yields lower. but the two-year and the three-year notes are leading the chart. look at a two and three-year note. they're comping back to july. and they continue to comp in mid-september and they will for awhile considering where we were at in the second and third week of september. but the point here is, is that this notion that the fed is done and inflation has peaked and continues to move lower is the driving force of this trade. and it's pick and choose. today we saw the price index 0.1 higher at 3.6, but the core price 0.1 lower. nobody mentioned the higher only talking about the lower. i guess there's a bit of interpretation. realize that in two sessions since monday's close, it's

deinverted by about 13 basis points. that is huge. we need to continue to monitor that, of course, and remember that tomorrow we have personal consumption expenditures, deflators, core deflators, income in spending, give us many more clues as to whether the beige book interpretation investors interpretation of the fed will continue to prove to be correct. kelly, back to you. >> thank you very much. further ahead, we'll talk about whether mark cuban is cashing out. the billionaire leaving shark tank, telling his majority stake in the mavs and who knows what's next. details when power lunch returns. but we help you shape your financial story. ♪♪ we're not an airline, but our network connects global businesses across nearly 160 markets. ♪♪ we're not a startup, but our innovation labs use new technologies to help keep your information secure. ♪♪ we're not architects, but we help build

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welcome back. disney's ceo bob i goer is sitting down at deal book. let's listen in. >> you're about to get a phone call from chairman of the board and you think that that call might be asking you back. and you say to your wife, what? >> well, i was aware that susan wanted to talk to me and i got a sense that the board was making

a decision to make a change at the ceo level of disney and they might ask me to step back. >> and you said to her? >> i said to willow, i'm getting this call. s she said, they may want your advice. she wasn't sure. and i said, well, what if i get asked. until maybe a day or two before, first of all, i was not seeking to return to disney at all. and until a day or two before, i was not anticipating i ever would. and so i asked willow, what do you think? and she said, well, they might not ask you. but if they do, she thought i had to say yes. and i asked why. and she said quickly reminded me, she said you ran the company for over 15 years, you've been at the company -- you were at the company for almost 50 years, you kind of owe it to the company. the board wants you back because they obviously don't feel they

have an alternative, at least not at that moment, you owe it to them to say yes. it was very quick. and i realized as i heard her words, she was right. >> what does she say now? >> i haven't talked to her about it. [ laughter ] what does she say now? we -- interesting, i don't that much work home with me. i like to leave the job at the office when i can. >> but you didn't think it was going to be like this? >> no. we've had conversations about it being much more challenging than i expected. i felt that from the beginning when i came back. but -- i'm not daunted by it. it's just a lot more work. nor is she daunted on my behalf. >> you said that you didn't want to come back, but, you know, there's been a lot of reporting that you never really wanted to leave. and even people now say, well, is he really going to leave in two years from now again? that you were frustrated -- you were frustrated with -- >> that reporting is completely

inaccurate. completely. i had been ceo for about 15 years. i said i started the company in 1974 at abc. been around a long time. there were plenty of things in the world that i was interested in that i wanted to do or wanted to learn more about. i had not really had a day off in, like -- i don't remember. and i was thoroughly enthusiastic -- >> i felt that i had accomplished so much during my former ten year including opening disneyland in shanghai and going to the streaming business very successfully. it wasn't about being bored. the time was -- >> but fair to say you were frustrated. you were watching this company -- >> frustrated about what? >> on the outside. >> you're asking me -- >> you ever wanted to leave in the beginning. >> the answer is i did, which is why i left. >> now you're on the outside -- >> busy, doing other things. >> but bob chapek is in that role and you were thinking what?

>> i was disappointed in what i was seeing both during the transition period when i was still there and while i was out. but i really worked hard at distancing myself from it because, one, i couldn't do anything about it. in a way it wasn't my business at all. it was his business to run. and, again, i was not happy with what i was seeing. i worked hard to build the company into what it was over that long period of time. i was proud of those -- i was proud of those accomplishments. it hurts when something that you've put your heart and soul into and you care about so much is going through a difficult time. >> let's talk about succession. there's a lot of people in this room who have to think about their own succession, other types of succession. what was your mistake then? to the degree that you think bob chapek was a mistake -- and i assume you imagine it's one of your biggest? >> first of all, i'm not the only one that may have considered it a mistake. the board obviously had its

issues with bob. and i -- >> but you knew him well? >> he worked for me for quite a long time. i've tried hard to conduct my own post mortem so we as a company don't do it again. what did we do wrong? and we've discovered certain things that perhaps we could have done better. but there were also a lot of unknowables. and i don't want to get -- >> is there a lesson for you in terms of who you're supposed to listen to? in terms of -- >> interesting when the vice president was talking about no job that trains you for this job. in many respects that's true at disney too. it's a large very complex company that's in the public eye all the time. there's interest from just about every sector of society in disney. and it takes a certain type to be able to not only

compartmentalize when it comes to managing issues and problems, but i think it takes a tremendous amount of energy, a tremendous about of patience, the ability to communicate on multiple subjects, sometimes back to back to back to back, and i think that, you know, when we take the -- >> what will be different this time? >> the succession process at disney is robust -- >> was it not robust the first time? >> it was, but i think we're approaching it differently. and i just don't want to -- it's just not something -- other than saying that we're aggressively pursuing succession. there's nothing -- no more detail that i want to give. >> do you think in two years, you really will step down? >> given the list of things that i have to do, i'm definitely going to step down. >> we're attacking each one of them. >> let's talk about that list for a second. i want to get your thinking,

understanding about how you think about it. you went on television over the summer from sun valley and you put out a lot of things on the table. you said, you know, we're thinking about selling abc and the linear channels, finding a partner from espn, we're in the midst of trying to figure out with hulu. you've resolved that. you put everything out there. and, by the way, the folks at abc just upped this way almost had a heart attack when they -- when they heard all of this. what was your thinking in terms of -- take us inside the thinking of saying that all aloud? a lot of ceos try to wait until they have each deal done. >> i've spent a year since i came back fixing a lot of problems that the company has had and dealing with a lot of challenges. some that were brought on by decisions that were made by my predecessor, some that are the result of tremendous amount of disruption in the world and in our business. including dealing with the

business model that those linear channels have rested on, have succeeded on top of for decades. and sometimes when i -- when i'm looking for kind of a reaction to my own thought process, i like to test that process in public. particularly in ways that i might be able to actually get a reaction from. my thought was at the time that i would essentially be public with some of that thought process, i think what i said about the media networks at the time was that everything was on the table and they might not be core to our company. i think i went that far. and that was a means of my saying to wall street or the investment community that our heads were not in the sand about the challenges that those businesses were having. i did not want to get accused of being an old media executive. we're a company that had already shown an ability to basically

adapt to new circumstances. i wanted to convey that. and, two, see what the reaction would be. would it be applauded or not. i did not say they were for sale. the coverage of what i said said they were for sale. there's a theme here, by the way, a little bit. just in terms of what is -- >> is it for sale? >> no, it is not for sale. but like all of our assets, we constantly are evaluating what is their value to the company today, what could the value be tomorrow? is it a growth business? is it a business that -- >> but you like the business still? big question about the linear channels -- >> here's what we've discovered. in this process which has been unbelievely rigorous at the company and involves a number of m people managing the businesses, they can be run more efficiently. you mentioned cutting over $7 billion in costs. we can do that. second, they can be run in

partnership with those businesses that sit atop the new business model which is streaming. and they're a means of aggregating audience of amortizing costs, reaching more and different people and so we actually threw this of being more public about what might happen and what could happen and figuring out is this something we should do, should they be divested. if they are kept, how should they be run. and they're being run much more efficiently today than they were in july when i made those comments. >> let me ask you a different question. you ultimately bought hue will you from comcast. but you say the following, there are seven or eight platforms in the streaming business alone, that's a tough business and it's not our strongest suit. >> when i came back to the company, and the company had been through a difficult time and the balance sheet wasn't as

strong, i asked the question, do we write comcast a check for what could be $9 billion or should we consider selling it to them? is the business unique enough, valuable enough to us long term for us to write them the check and buy the whole thing or the opposite? and i created a rigorous process to determine what is the right answer to that question. i worry that there was in general entertainment programming unlike disney, pixar and marvel, it's not as differentiated, maybe not as valuable. through this process determined that owning the whole thing had real value. partnering that business with the other branded streaming business, disney+, could actually create huge opportunity for us -- >> let -- >> and we decided to keep it rather sell it. >> you just mentioned pixar and marvel and so many of these other things. very recently as you've seen -- because you get the box office numbers every weekend -- a number of these films have not

performed. they have not performed the way they used to. people question the creative magic at disney. you can look at the marvels. i'm curious why you think that disappointed. you could look at wish. indiana jones. what's happening -- >> i think you have to look at it a couple of ways. first of all, i think the movie business is changing, actually. box office today is about 75% of what it was pre-covid. i think we have conditioned the audience to expect that these films will be on streaming platforms relatively quickly and that the experience of accessing them and watching them in the home is better than it ever was, one, easier to access in terms of the technology, two, just the visuals, better sets in your living room than before. and a bargain, when you think about it. streaming disney+, you can get for $7 a month. it's cheaper than taking your family to a film. i think the bar is now raised in

terms of quality about what gets people out of their homes into movie theaters. some of it is just being part of basically the social wave. barbie and oppenheimer did that for two other studios. i think that's one thing. second in our particular case and specifically about those films, some of those films, they were not as good, they were not as high in quality -- not every one that you mentioned -- as some of their predecessors, our films. as they should have been, particularly in this environment. >> why do you think that was? >> the marvels was shot during covid. there wasn't as much supervision on the set, so to speak, where we have executives there really looking over what's being done day after day after day and that was a result of -- and mostly of covid but at the same time we increased our output tremendously to feed the streaming platforms. too much, by the way. >> mistake? >> definitely mistake. quality needs attention to deliver quality. it doesn't happen by accident. and quantity in our case diluted

quality and marvels suffered greatly from that. there are different reasons. i'm the first, i've been very public about it, saying -- i would say right now my number one priority is to help the studio turn around creatively. let's put it in perspective. we set the bar so high year after year after year. we have the best performance in the business probably for a decade. and i'm not sure another studio will ever achieve some of the numbers that we achieved with multiple -- we got to the point where if a film didn't do a billion dollars in global box office, we were disappointed. that's an unbelievably high standard and we have to get more realistic. a couple of the films you mentioned, by the way, which is interesting about kind of the new world order, did okay at the box office, element is a good example. 500 million at the box office. to some studios, that would be a hit. when disney has a $500 million film it's a failure which is

entering. it went on disney+ and had massive consumption. so that says something. maybe people didn't perceive it was the kind of film they needed to see in the theaters. but they certainly when they discovered it on disney+ enjoyed it. lenc >> let me ask you about franchises and the value of ip. i don't think most people have ever read this letter. this was a letter written in 1967 by walt disney, the man himself, it was two months before dying from lung cancer. he was a heavy smoker. and he wrote this about what he said makes us tick here at the disney organization. many people have asked why don't you make another mary poppins, by nature, i'm a born experimenter. i don't believe in sequels. i can't follow popular cycles. i have to move on to new things. people have been asking us to make sequels ever since mickey mouse first became a star. back in the '30s, the three little pigs was an enormous hit.

and the cry went out give us more pigs. i didn't see how we could top pigs with pigs, but i tried. and i doubt any of you can name the other cartoons that the pigs appeared. we didn't make the same mistake with snow white. right now, we're not thinking about making another mary poppins, we never will. perhaps there will be other ventures with success, but we cannot hit a home run with the bases loaded every time go to the plate. wew the only way we can get to first base is by constantly going to bat and continuing to swing. what would walt think now? >> i'm going to talk to him later. maybe i'll let you know. i actually think about that a lot. about five years ago we put walt's office back together again. including the order of the books of the shelves and we decided kind of out of respect for him,

we would return it to what it looked like then. interesting you mentioned he was a smoker. it's filled with ashtrays. wherever you go there's an ashtray. and i go in -- not to smoke. i don't smoke. i go into his office to feel the presence. i know that sounds a little weird. it's a nice way to relax and appreciate the legacy of the company. and the first thing you really realize, if you study walt is that walt was unbelievable at adapting to change. first of all, he loved technology. he loved to use technology. and he also new that the world was not a static place. that was true for his theme parks, his movies, television, everything that he did. he was a true innovator and novemb innovator is someone who never stands still. and that quote, we had just done a sequel to mary poppins when you read it to me. i thought this is good timing. i think -- i don't want to

apologize for making sequels. some of them have done extraordinarily well and they've been good films too. i think there has to be a reason to make them. you have to have a good story. and often the story doesn't hold up to -- it's not as strong as the original story. that can be a problem. but it has to have a reason -- you have to have a reason to make it beyond commerce. there has to be -- it has to -- it has to be an artistic reason to make it. and we've made too many. it doesn't mean we're not going to continue to make them. we're making a number of them now -- as a matter of fact. including to some of your best films. but we will only green light a sequel if we believe the story that the creators want to tell is -- >> do you think you can make originals or do you think the franchise game is -- >> that was disney's ceo bob iger speaking at theoo bk deal. we'll have much more on power lunch when we come back after the break.

first time i connected with kim, she told me that her husband had passed. and that he took care of all of the internet connected devices in the home. i told her, “i'm here to take care of you.” connecting with kim... made me reconnect with my mom. it's very important to keep loved ones close. we know that creating memories with loved ones brings so much joy to your life. a family trip to the team usa training facility. i don't know how to thank you. i'm here to thank you. welcome back. it's time for the next installment of our econ ecosystem series. we've hit the big box stores. today we're going inside the mall for a look at the apparel

retailers. morgan stanley out with a new note saying black friday foot traffic was sluggish given the cautious holiday outlook. american eagle, gap, nordstrom, victoria secret, all up following the holiday. but which names make morgan stanley's list of black friday winners. let's ask the expert on the topic. let's start off with a big, bold question. who won and who lost over this holiday shopping weekend? >> yeah, i mean, getting right to it, i would say the winners and the laggards as we saw them, this is a more limited data set. aerie was a winner, we had gap, within the broader gap portfolio, holster which sits within abercrombie and old navy.

and the way that we measure that to be clear is that all four had higher line counts despite either unchanged or even lower promotional a levels. they were able to garner the attention of the consumer without sacrificing margin. so that's how we characterize it as winners, can be subjective. i think on the other hand, there were some laggards per the data in our check. and that included american eagle, nordstrom, pink and torrid. it's the same type of methodology. this group really fell into camps. they had lower traffic on similar promotions compared to last year or they had unchanged traffic on higher promotions. effectively, it's can you drive traffic and how much of that hurts your bottom line as you're doing it. and so i will say, this only reflects a single day. holiday shopping is becoming less concentrated around single days. it's not a perfect gauge. we have a lot to go.

we have eight of the ten largest shopping days ahead of us in the season. so there's much more to go from here. >> alex, there's an argument to be made that consumer balance sheets right now are perhaps not as strong as they were a year or so ago because of the dissipation of stimulus money, that sort of thing. on the other hand, comparisons may be easier for some retailers given bloated inventory levels from last year which have righted themselves this time around on balance. does it mean that we're net-net okay or does it mean that maybe the retailers have stuff left to do for the rest of the season? >> yeah, i mean, it's a great point on where the consumer stands. and i think this is the first time in a number of years because i've been a little bit more optimistic heading into holiday. but i caveat that as cautiously optimistic. what that means is, we do not expect strong demand or a change in fundamentals for our retailers. our businesses are continuing to operate and probably will in the

fourth quarter at both sales and profitability levels that are below pre-covid trend on average. but really, my more optimistic is a function of a low bar. our retailers have set a low bar throughout the year and the statistics we look at and they are going to benefit from a favorable calendar this year that i think people tend to overlook historically. when i will take that together, it feels like the market sentiment could be too bearish for, to use your words, could be an okay holiday. this could really lead to a january rally. if you might remember, it's very similar to the dynamic last year on a late inflection in holiday trend. >> one more quick question. i think if you cover kohl's or big card businesses really significant. what is the disruption of buy now, pay later going to mean for the viability of those card businesses going forward?

>> sure. so the card business is such a tricky subject in my space because there is such limited disclosure. for some there is real risk around it. we did work about three or four years ago that suggested that the flow through to ebit could be almost 100% of the cardredit card revenue. they are cagey around what information they give and they have a little bit better handle on it as i dove in. i think that's a key unknown in the case, that many investors are debating and there is not a great answer. i wish i had a better answer for you. it's a key unknown in overhang given how limited the disclosure is. >> thank you. appreciate your time today. >> thanks for having me. technical support is coming up next. weilchk wl ecout the chart. keep it here. "power lunch" is back after this.

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hey, is this thing hard to learn? nah, it's easy. huh. you know, i think i'm going to ride it home. good thing you chose u.s. bank to manage and grow your money. with our 24/7 support at least you're not taking chances with your finances. yeah, i think i'm gonna need a chair. oh, ohhhh. a. welcome back to "power lunch." it's time for our technical support today and we are looking at three names in the news and here to chart them is craig johnson. he is piper stanley's chief technician. welcome. >> thank you for having me back. >> three good stories. general motors. a a lot of news on the share buyback. shares up 10%. >> i think it will take more time. when you look at the shares of joan most you have a good relief rally back to the 200 day moving averages. that's all it is, a relief

rally. more time required from my perspective on this stock. >> more time? so you are not -- okay. we see those -- those lines that you are following are the moving averages? >> yeah, following the moving averages here. we have the sort of resistance level right here. then we've got another support level here. we are seeing a move back up into this sort of area here. i would kmt expect the stock would do anything more than perhaps fail here and roll back over. there are challenges. the share buyback is helping. but from my perspective, there are better stocks to buy. >> in autos? >> not necessarily in autos. but tesla i would say looks more constructive. i would say some of the retailers that you were discussing like abercrombie & fitch. >> >> all right. elsewhere in the news. stuff on cigna, humana, maybe getting to the to try to compete with the 800 pound gorilla, united health when it comes to just about everything health

insurance. is unh, dow component, heavy, heavy influence on the market a stock you would buy or sell now? >> at that point in time i put that as a hold also. the reason is because when i look at the chart you are just sitting here consolidating. i would be a buyer if we could break out above that sort of resistance level at $550. i might be a buyer at that point in time. as a technician, i want the confirmation, the breakout, a pick up in volume through that. >> entry stop at 550, you said? >> correct. >> okay. >> that's a couple of years we are going back really that it's been moving sideways. it's been -- they have been hitting the ceiling multiple times. >> they have. they are doing a lot better than at loft other health care stocks. we got our health care conference happening right now in new york and there is a lot of those companies. they are still trending lower. this is a good relative outperformer, but not breaking out quite yet. >> that sector was suppose to be the place to hide this year.

now they just want to hide. octa, a massive hack, customer data exposed. what's the damage or what's the opportunity? >> at this point in time looking at the chart of octa, we have support levels and restens levels. looks like another relief rally coming into play for october a. this is one of these names we are back up to the moving averages right here and we need to get back through this. i like the fact we have had the high or low get made. not trending as strongly, as good of relative performance as i would like as other parts of the market at this point in time. as i continue to watch okta, it needs more time to ultimately sort of break through these levels and take out some of these prior high levels into here. >> all right. we have gotten through the three names in the news. >> correct. >> let's go, because i know kelly likes going big picture. >> it's almost like now that we are here and have this two and a half minutes, i want nvidia, he mentioned tesla. mag 7. i mean, you think they are all going to run?

>> i think market is entering period of time. by the way, let me say we have a 48-25 price objective. we think they will get there. >> 5% from here in. >> another 5% to go. ten-year bond yields are breaking down. an important resistance level of 433 today. trading down to 200 day moving rhythm in a welcouple of weeks. >> which is? >> 397. >> you think we could do that the next couple of weeks, go below four? >> absolutely. nonconsensus call by all means. >> after the action the last couple of days, people are rethinking that. >> correct. and there is a lot of individuals that are sort of mispositioned. as equities are working, rates are coming down stocks are wor working well. what will work well is financials. as you look forward into 2024 we will be bringing out our 2024 outlook next week. so, hopefully, i can come back and bring thouse pieces out.

>> you are picking financials, we want to hear that for sure. >> if you look at the broader s&p 500, financials are not heavily weighted at all. with the outlook for the s&p chart-wise, longer term, can this extend into the first half of 2024? >> equities can definitely work in the first half of 2024. but the magnificent seven companies may need to take a little bit of a break. maybe enter a high level trading range and consolidate sideways. in that 7-eleven we could see the financials pick up in performance. financials are important to the market. november to at least participate for equity markets to work and i think you are going to start to see the yield curve shift and start to see with the rates coming down, a lot of those mid cap banks, which make up a lot of the russell two 2000 -- >> balance sheets are healthier. >> you think the russell 2000 can finally start to -- >> correct. >> in the game -- >> i think the russell 2000 can step into the game. and i definitely think that the mid small caps will have a great

year next year. it's been challenging this year. i know this again is not consensus. everybody's -- >> i hope you are right. this sounds great. it sounds like, you know -- >> everybody has been focused on the mag seven. we have signals last week. this market's ready to go. >> thank you very much. >> thank you. >> thanks for watching "power lunch," everybody. >> "closing bell" starts right now. we are going to pick it up there. welcome to "closing bell." i'm mike santoli. this make or break hour begins with stocks trying to execute an immaculate rotation. the biggest megacap winners. lacking groups such as banks and small caps and the broadening action that so many investors have been waiting and hoping for. the nasdaq 100 basically flat. a bit more strength underneath the equal weighted s&p off about a half a percent